What Are Merchant Services? Everything Business Owners Need to Know in 2025

As a business owner, you have a lot to think about. From managing inventory and payroll to tracking expenses and running marketing campaigns, your time is consumed by the daily demands of keeping everything running smoothly. So, when a customer wants to pay with a card, you shouldn’t have to spend time calling banks or credit card processors to ensure the funds are transferred. You need a reliable partner to handle that for you—and that’s where a Merchant Services Provider (MSP) comes in.

What does merchant services mean?

"Merchant services" is a broad term that refers to the technology and support systems that allow your business to accept and process card payments - whether online or in person. Unlike a credit card processor that only moves the money, a merchant services provider works directly with your business to support every step of the payment process.

Here’s how it works:

When a customer makes a purchase at your business, you use a Point of Sale (POS) system to enter the transaction. To accept their payment, you need a payment gateway — the tool that securely captures their card information. Then, a credit card processor moves the funds from the customer’s bank to yours.

A merchant services provider helps you access and maintain all of this technology, ensuring a smooth, reliable experience for both you and your customers.

Who Needs Merchant Services?

Merchant services are designed for businesses of all sizes. Whether you're running a single-location shop or managing multiple stores, there are providers that cater to your needs.

Some MSPs specialize in equipment and software for small businesses, while others offer comprehensive solutions for larger operations. Many providers also tailor their services to specific industries - such as restaurants, retail stores, or coffee shops - while others offer versatile platforms that suit a wide range of businesses.

At Southern Bank, we proudly serve businesses both big and small across a variety of industries. Whatever your business looks like, the benefits of streamlined, reliable payment processing are clear.

Benefits of Southern Bank Merchant Services Powered by Clover

To give you an idea of what to expect, here are the services and business tools that we offer to help make it easier to run your business:

Concierge-Level Service and Support

• Always on, 24/7/365 support for your device, merchant account and/or Apps
• Access to Next Business Day hardware replacement services on orders received prior to 5 p.m. ET to get you back up and running quickly

Multiple Layers of Security

• Multilayer security that helps guard your account
• Fraud protection up to $100,000 with the addition of Clover Security Plus

Comprehensive Business Insights

Monthly statements with personalized business insights to help you make more informed business decisions (For example: Sales trends, customer reviews and ratings, and local events)

Simplified Pricing

Many competitive pricing options, including the popular flat-rate pricing, as well as equipment bundles that provide for an overall easy-to-understand statement.

Suite of Customizable POS Systems

• Choose from a variety of Clover hardware Point-of-Sale (POS) systems that can double as a business management system
• Clover delivers a complete, all-in-one solution for running your business that empowers you to personalize your customer experiences

Dedicated Team of Engagement Liaisons

• Industry specialists that help you take advantage of your merchant benefits
• Proactive onboarding support first 90 days
• Periodic business consultation

Business-Building Tools and Resources

Educational content is available to help you streamline operations as well as manage and grow your business.

How do I get started?

Every business is unique, which means your needs may differ from those of others. To explore whether Southern Bank’s Merchant Services are the right fit for you, visit our Merchant Services page and review the available options.

If our services sound like a good match, you can begin by filling out our online form to request a quote tailored to your business.

It’s a smart idea to compare quotes from multiple providers. However, be prepared - merchant services can be complex. Many companies offer similar features, but with varying pricing models and terms. Choosing the right provider takes careful consideration, and you don’t want to end up locked into a contract with a company that doesn’t meet your needs.

So how do you pick the right option?

What to Look for in a Merchant Services Provider

1. Value-Added Programs

Many providers include gift card and customer loyalty programs. These tools can help you grow your business and retain customers. Before committing, consider whether these features make sense for your business and if they come at an extra cost.

2. Understand the Costs

Pricing can be confusing, but knowing the basics will help as you compare quotes.

Most MSPs charge a flat monthly or annual fee for software and service access. However, that’s only part of the cost. You’ll also pay processing fees for each transaction—and this is where things get more complex.

Processing fees are generally split into two parts:

• Card Network Fees – Paid directly to companies like Visa, Mastercard, Discover, or American Express. These are non-negotiable and vary by card type.
• MSP Markup – The additional amount the provider charges on top of the card network fee. This is where pricing structures differ.

Here are the most common pricing models MSPs use:

• Flat-Rate (Blended) Pricing
  You pay a fixed percentage plus a set fee per transaction. Simple to understand, but often the most expensive option.
• Tiered Pricing
  Fees vary depending on the type of card used (e.g., debit, credit, rewards). While more complex, this method can sometimes offer lower rates than flat-rate pricing.
• Interchange-Plus Pricing
  You’re charged the card network’s fee plus a fixed provider markup. Though less predictable, this method can often result in the lowest overall cost.
• Membership Pricing
  Instead of marking up per transaction, the provider charges a monthly or annual membership fee. You still pay card network fees and a per-transaction fee. In some cases, this can be the most affordable option.
  
  Pro Tip:
  The processing rate you’re quoted is typically an average. Actual rates can vary based on several factors, such as the card type, whether the card was present during the transaction, and how the information was entered.

3. Local Support Matters

When issues arise, fast support is essential. Some providers outsource support, which can leave you waiting on hold for extended periods. Choosing a local provider can mean quicker resolutions and less downtime for your business.

4. Stay Focused on Your Needs

It’s easy to be drawn in by the latest technology or flashy features. While some of these tools may benefit your business, others may add unnecessary costs. Always evaluate whether a feature aligns with your business goals. And remember: if an offer seems too good to be true, it probably is. Review quotes carefully, understand the true costs, and keep your priorities front and center.

Already have a provider? We’ll help you compare services and identify cost-saving opportunities—without the pressure.

Merchant services are just one-way that Southern Bank supports businesses. Whether you're opening your first location or scaling across regions, our business solutions grow with you. And remember, if you have questions at any stage, our team is here to help you navigate the process and find the right solution for your business.

Frequently Asked Questions

What are merchant services?

Merchant services is a term used to describe the technology and support systems that allow your business to accept and process card payments—both online and in person.

What’s the difference between POS and payment gateway?

A POS (Point of Sale) system is the hardware and software used by businesses to complete sales transactions in person. Think of it as the cash register system where you ring up items, take payment, and print receipts. While a Payment Gateway is a software service that authorizes and processes online payments - usually for e-commerce or digital services, a secure ‘middleman’ between a website's checkout page and the payment processor or bank.

What do merchant services cost?

The cost of merchant services can vary depending on the needs of your business and the pricing models offered by your Merchant Services Provider. Visit our Merchant Services page to learn more about Southern Bank Merchant Services Powered by Clover.

Can I use Southern Bank’s solution if I’m not a current customer?

Yes, you do not need to be a customer to utilize Southern Bank Merchant Services Powered by Clover. However, we also offer a variety of business checking accounts and cash management services designed to help streamline your operations. Visit us today to learn how Southern Bank can be your trusted business partner.